Ülkeler arasında mali sürtünmeler, toplam verimlilik farklılıkları ve gelir dağılımı

This essay analyses the effect of credit frictions on capital misallocation, aggregate output, productivity, and income divergencies between countries. The essay is composed of five chapters that analyse how credit misallocation from financial frictions impact cross-country income differences. The first chapter identifies the key sources of financial frictions and demonstrates how frictions embedded in the intermediation process generate capital misallocation by driving wedges between savings and credit, investment, inputs and outputs, allocation of entrepreneurial talent, and occupational choices. In chapter two, I review the broad evidence on credit market frictions on GDP and cross-country income distribution. I then locate the specific causal channels and the key underlying mechanisms through which these frictions affect resource allocation and economic development. The third section presents a standard model of development with incomplete financial markets characterised by frictions to capture and quantitatively evaluate the impact of financial impediments on total output, aggregate productivity, and income differences between countries. The model presented in this section is of an economy with a dual financial scheme: a credit and savings regime. The households or firms with sufficient savings or wealth endowments become entrepreneurs, while those without adequate savings and capital choose to become wage earners by supplying labour or exiting the market. Talented households without savings can decide to become entrepreneurs by borrowing but must posit collateral thus, the size of the loan is dependent on the collateral value. Collateral thus, act as a borrowing constraint. The study emphasises frictions originating from – borrowing constraints (collateral), participation costs, and intermediation costs. Chapter four presents the findings. The main conclusion drawn from this essay is that there is a robust connection between financial frictions, credit misallocation, aggregate output losses, lower TFP, and economic underdevelopment. These results confirm the evidence that financial frictions amplify and perpetuate the persistence of income variations between countries. The main idea presented in the model is that financial frictions inhibit some establishments from hiring inputs to adopting modern technologies and accessing credit for investment which lower TFP and amplify income gaps. The estimates show large income and TFP losses exceeding 30% of GDP within countries with underdeveloped financial markets indicating that a move to the frontier of financial development by poor countries with underdeveloped financial markets could increase productivity, income, and GDP significantly. These estimates broadly mirror recent empirical findings observed in the literature on financing frictions and cross-country income gaps. In the absence of financial frictions, TFP and output loss would reduce significantly to about 5% due to efficiency gains.